Hire Wire Jan 05 2012

Finance Layoffs Accelerated in December

By julie steinberg

The finance sector announced nearly seven times as many layoffs in December than in October, reflecting continued turmoil in the industry, according to a report by Chicago-based outplacement company Challenger, Gray & Christmas.

Banks, brokerages and other financial services companies announced plans to shed 7,433 jobs in December, up from 1,681 jobs in November.

For all of 2011, the finance sector announced 63,624 cuts, up 165% from 2010.

Announced job cuts in December include 1,600 at Morgan Stanley and an exodus of partners from Goldman Sachs.

John Challenger, CEO of Challenger, Gray & Christmas, is wary of a bleak 2012.

"There's so much pressure on the financial sector to continue to consolidate," he said in an interview. "A lot of banks can't pay back TARP money and they're going to be subject to acquisition by stronger banks. That's going to lead to a condensing of headquarter staff and bank operations at acquired banks."

Challenger said the uncertainty surrounding Dodd-Frank, coupled with the potential impact from the failed European banking system, will also contribute to job cuts.

Across all industries, cost-cutting and restructuring were the most prevalent reasons for layoffs.

Write to Julie Steinberg

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